CMS Releases Proposed 2020 Home Health Rules

Statement of NAHC President William A. Dombi

Regarding the Medicare Home Health Proposed Rule

CMS late today issued the proposed rule for the 2020 payment model, PDGM, including rates of payment that would start January 1, 2020. The new payment model had been finalized in its design in the 2019 rulemaking cycle. The proposed rule offers some minor tweaks in the payment model and sets out 2020 payment rates for the first time. The proposed rule also includes unrelated adjustments in other rules affecting home health, including the 2021 home infusion therapy benefit, quality measures and the Home Health Value Based Purchasing Demonstration program.

NAHC remains very concerned that the new model still includes the risks created by a significant “behavioral adjustment” that is based solely on assumptions of clinical and claims-related changes that HHAs might undertake to offset the payment rule’s impact. That adjustment was suggested as a 6.42% reduction in base payment rates in the 2019 proposed rule. With the 2020 proposed rule, CMS sets out the behavioral adjustment as an 8.01% reduction in base payment rates calculated on the assumption that HHAs will modify service and documentation practices in ways that would increase Medicare spending. The adjustment is ostensibly proposed so that overall budget neutrality in Medicare home health spending is achieved in 2020 by offsetting anticipated spending increases with a rate reduction. NAHC continues to hold that rate reductions based on behavioral changes that have not yet occurred creates significant dangers for home health patients. The risks of disruptions in access to care are compounded by the institution of a dramatically modified payment system model along with an across-the-board rate cut that is based on conjecture.

The Bipartisan Budget Act of 2018 requires that the home health payment model reform be budget neutral. While it permits behavioral adjustment to payment rates, NAHC believes that assumption-based rate calculation should not occur because of the high risks of error and the creation of an incentive to change behavior solely to maintain Medicare revenues. Instead, NAHC supports adjustments only after actual behavioral changes have occurred.

It appears we need the wisdom of Congress to intervene and stop this proposal from becoming reality. NAHC supports sensible payment reform. While the payment model reforms include sensible changes, the behavioral adjustment is neither sensible nor warranted. Thankfully, there is bipartisan, bicameral legislation pending that can fix this serious flaw in the new payment model.

We have long supported rational payment model reforms. While the new model does include some good system refinements, its foundation is severely weakened by the unwarranted and unsupported rate reduction based on nothing but pure assumptions that home health agencies will abuse the payment process.

Congress has limited time to intervene and preserve access to vital home health care. We will be working hard with Congress in the coming weeks to secure sensible payment reforms and to protect the 3.5 million Medicare beneficiaries who receive home health services throughout the country. We are heartened by the widespread support in Congress that recognizes the value of home health services.